FAQ
Does an Appraisal Report require an authentication?
What do the Letters at the End of the Appraiser’s Name Represent?
What is USPAP and Why is this IMPORTANT?
What Constitutes a “Qualified Appraiser”?
How Does an Appraiser estimate or Determine the Value of an Item?
Why are there Various “Types” of Values?
What Styles of Appraisals are There?
when will i need an appraisal?
What Types of Appraisals are there?
who needs an appraisal?
Does Heritage Appraisals purchase, auction, or consign items?
How Do I Have My Items Insured After An Appraisal?
Insurance Appraisals: Insurance appraisals provide essential documentation to verify your belongings' existence, condition, and replacement value. It is advisable to have an update performed every five to ten years or before a planned household move.
Resale Appraisals: This appraisal will provide the necessary documentation of fair market value, ensuring that all parties involved are informed about the personal property. Although Heritage Appraisals does not buy or sell items to avoid any conflict of interest, we can provide the client with a list of reputable auction houses, brokerage firms, consignment shops, and estate dealers who have a strong background in handling such items. This will assist in the sale process. From there, the client can decide how to proceed and whom they would like to work with.
Charitable Contribution/Donation Appraisals: The IRS recommends this appraisal to support a tax deduction over $500; however, it is mandatory for donations above $5,000 to a charitable organization or institution.
Pre-move Appraisals: Because moving companies offer limited protection against damage or loss, it is important to obtain an appraisal for your high-value items. This appraisal will provide a detailed inventory that supports those items' higher value and existence. It can also help you secure the additional insurance you may need.
Equitable Distribution Appraisals: This appraisal is utilized during a divorce or estate settlement to ensure a fair distribution of property.
Estate Appraisals: This appraisal is required for taxable estates, litigation, and probate. It is essential to accurately document the property by providing an appraisal that complies with IRS and legal standards.
Trust or Will Appraisals: This appraisal should be attached to the trust or will, and a copy should also be given to the trust attorney, who has knowledge of the property and is aware of who is to inherit each item.
What Types of Appraisals are There?
Museum, Corporate, University & Private Client Services
• Personal Records
• Insurance Coverage
• Damage Claims
• Resale Function
• Charitable Contribution/Donation
• Tax Deductible Gifts
• Divorce Settlements
• Equitable Distribution & Dissolution
• Estate, Will & Trust Planning
• Estate Evaluations
• Estate Probate Tax
• Litigation Support
• Investment Evaluations
• Appraisal Review
• Consultation Services
when will i need an appraisal?
Restricted-Use Appraisal Report: Provided when the intended users do NOT include parties other than the client.
Appraisal Report: Provided when intended users include MULTIPLE parties in addition to the client, such as the Federal Government, Estate functions, etc.
WHAT STYLES OF APPRAISALS ARE THERE?
The type of value used in your appraisal report will be determined by the appraiser. This value is based on the specific purpose of the report, which may include insurance coverage, estate evaluations, wills, trusts, equitable distribution, charitable contributions, resale, divorce, bankruptcy, or general knowledge.
During the initial consultation, the appraiser will discuss the purpose of the appraisal report with you and explain the different types of reports and values. They will help you understand which type of report is best suited for your needs.
WHY ARE THERE VARIOUS “TYPES” OF VALUES?
Appraisers estimate/determine the value of items by considering various factors. They assess and analyze numerous market sources relevant to each item in both primary and secondary markets, depending on the type of value or report needed. The appraiser examines each comparable item for similarities in characteristics, such as artist/designer, subject, size, condition, quality, and market area. These comparable items are typically included in the report, allowing clients to review how the appraiser reached their conclusions and to gain a better understanding of the market perspective.
HOW DOES AN APPRAISER ESTIMATE OR DETERMINE THE VALUE OF AN ITEM?
A qualified appraiser is an individual who:
• Has obtained an appraisal designation from a recognized professional appraisal organization, demonstrating competency in valuing the type of property being appraised. Alternatively, the individual may have met certain minimum education and experience requirements or completed college or professional-level coursework relevant to the property being valued, and must have at least 2 years of experience in the business of buying, selling, or appraising such property.
• Regularly prepares appraisals for which they are compensated.
• States that they are qualified to conduct these types of appraisals
Excluded individuals include:
• The donor of the property or the taxpayer claiming the deduction.
• The donee (the recipient) of the property.
• A party involved in the transaction through which the donor acquired the property.
• Typically, a party to the transaction does not qualify to sign the Certification of Appraiser section. However, a person who sold, exchanged, or donated the property to the donor may sign the certification if the property is donated within two months of the date the donor acquired it, and the property’s appraised value does not exceed its acquisition price.
• Any person employed by, married to, or related to any of the above individuals, or anyone whose relationship to any of those involved in the donation could lead a reasonable person to question the appraiser's independence. Part III (Section B) of IRS Form 8283 lists individuals who cannot be qualified appraisers.
• An appraiser who regularly provides appraisals for any of the individuals listed above and who does not perform the majority of their appraisals for other clients during that tax year.
It is important to understand that intentionally overstating the value of the property may subject the appraiser to penalties for aiding and abetting an understatement of tax liability. The donor may also be liable for penalties for overstating the value of donated property.
WHAT CONSTITUTES A “QUALIFIED APPRAISER”?
USPAP - Uniform Standards of Professional Appraisal Practice
The purpose of the Uniform Standards of Professional Appraisal Practice (USPAP) is to promote and maintain a high level of public trust in appraisal practice by establishing requirements for appraisers. It is essential that appraisers develop and communicate their analyses, opinions and conclusions to intended users of their services in a manner that is meaningful and not misleading.
The Appraisal Standards Board promulgates USPAP for both appraisers and users of appraisal services. The appraiser’s responsibility is to protect the overall public trust and it is the importance of the role of the appraiser that places ethical obligations on those who serve in this capacity. USPAP reflects the current standards of the appraisal profession.
A well-constructed report can meet the requirements of being objective, complete, accurate and not misleading only if it reflects the uniqueness of each situation and presents arguments (either for or against a conclusion) in a well-written and convincing fashion.
Reports should include the following:
• Documentation of why the appraisal is being conducted (the intended use)
• What the appraiser is being asked to conclude (the objective)
• What conditions surround the appraisal that could affect the appraiser’s conclusions
• What approach to value/cost was used
• Complete descriptions
• Statements of condition
• Provenance (history of ownership), exhibitions and citations in literature
• Results of tests done for identification or authentication
• How value characteristics of the subject property compared with those of comparable properties
• What markets were explored and how were they analyzed
• Records of past sales of comparable property
• A reconciliation of data and a final value conclusion
WHAT IS USPAP AND WHY IS THIS IMPORTANT?
Qualified Appraisers are generally affiliated and trained with one or more recognized appraisal organizations and maintain a continued relationship with their organization of choice to stay up to date on the newest report writing standards and educational elements. These relationships are typically maintained for the entire career of the appraiser so they maintain the most up to date knowledge in their field.
There are many appraisal organizations, but below are the most commonly found in the personal property field:
• (ISA) – International Society of Appraisers
• (AAA) – Appraisers Association of America
• (ASA) – American Society of Appraisers
Among these organizations, there are member credential designations which are based on the appraiser’s education level and training.
Below are the designations for the International Society of Appraisers which Heritage Appraisals is affiliated:
• Member– ISA: Completed the core ISA training in appraisal theory, methodology, ethics and report-writing standards and has documented three or more years of market-related experience.
• Accredited Member– ISA AM: The official designation of a qualified ISA appraiser with a declared specialty and 700 documented hours of appraisal-related experience.
• Certified Member– ISA CAPP: The highest achievement in ISA credentialing and the appraisal industry, signifying appraising expertise, professional development and advanced skills. An ISA CAPP member has 900 documented hours of appraisal reporting and has passed the CAPP examination
WHAT DO THE LETTERS AT THE END OF THE APPRAISER’S NAME REPRESENT?
Every insurance company operates differently. We recommend that before you begin the appraisal process, you contact your insurance company (if you already have one) to discuss their requirements and procedures regarding the insurance of your valuables. The way fine art, jewelry, and antiques are insured can vary significantly, and the coverage for these items may be much lower than their actual value if they are not individually scheduled.
Once you have all the necessary information from your insurance company, we can begin the appraisal process tailored to your needs. After the report is completed, you can send a copy to your insurance company to initiate the process of developing a coverage package for you. It's important to remember that even if you have an item appraised, you are not obligated to insure it. You can choose specific items from the report to insure and leave others unscheduled if you prefer. Many clients opt to have items appraised for personal knowledge—for themselves or their heirs—They may choose not to insure certain items due to lower values or a reduced concern, aiming to keep premiums lower.
If you do not currently have an insurance company or if your company does not provide coverage for such valuables, Heritage Appraisals can provide you with a list of nationally recognized insurance companies that offer comprehensive or umbrella coverage options. You can reach out to these companies directly to explore your options.
How do i have my items insured after an appraisal?
No, Heritage Appraisals does not offer any dealer services due to possible conflicts of interest. We provide resale appraisal reports for clients looking to sell their items. We can assist by supplying a list of recognized auction houses, brokerage firms, consignment shops, and estate sale representatives. Once the appraisal report is completed, you can contact these professionals directly to initiate the selling process. While we do not participate in this step, we aim to provide you with a detailed, comprehensive, and unbiased appraisal report that is a knowledgeable tool in the selling process.
